The Nio Inc – ADR (NYSE: NIO) stock price rallied 11.2% yesterday. It extended the rally to today after announcing a partnership with China National Offshore Oil Corporation (CNOOC) to help build its EV charging infrastructure and the battery swapping program.
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The rally in Nio shares could also be attributed to the massive $1 billion investment made in the company by the investment arm of the Abu Dhabi government. The deal shows the growing ties between China and the Middle East and contributed to the rally in Nio shares.
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CYVN Holdings, a mobility-focused investment company, executed the deal with Nio on behalf of the Abu Dhabi investment firm. CYVN bought 84.6 million shares at $8.72 each, or approximately $738 million in cash. The unit bought a further 40.1 million shares from an affiliate of existing NIO shareholder Tencent for $350 million.
Therefore, CYVN’s total investment in Nio was nearly $1.09 billion, leaving the Abu Dhabi government with a 7% stake in Nio and entitled to nominate one member to the EV manufacturer’s board.
NIO and CYVN also agreed “to cooperate to jointly pursue opportunities in NIO’s international business,” NIO said in a statement. The deal highlights the growing global attractiveness of China’s EV companies and EV market, the largest vehicle market globally.
Nio’s energy division, known as Nio Power, signed a strategic cooperation framework agreement with CNOOC Refinery, CNOOC's petroleum refining subsidiary, to jointly build charging and battery swap infrastructure, the electric vehicle (EV) manufacturer said yesterday.
The deal was signed by Qin Lihong, co-founder and president of Nio, and Wang Weimin, chairman and general manager of CNOOC Refinery, who attended the signing ceremony in Hefei, Anhui province.
The two executives remotely witnessed the launch of the first joint battery swap station between the two companies in Huizhou, Guangdong province. Wang also visited one of Nio's manufacturing sites and a Nio House in Hefei and had a hands-on experience at a battery swap station.
Everything is going well for the company, although concerns linger that discontinuing battery swaps for new Nio clients could negatively affect its sales.
*This is not investment advice.
Nio stock price.
The Nio stock price was up 0.11% during premarket trading, extending yesterday’s 11.19% rally.
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